Foreign trade rides the crest of a wave
Switzerland's foreign trade is booming, with exports from the watch industry putting in another strong performance in March.
Exports as a whole rose by a real 15.3 per cent in March to SFr15.14 billion ($11.93 billion), the Federal Customs Office reported on Tuesday.
Imports went up by a real 9.7 per cent to SFr14.30 billion. Overall, the country ran a merchant trade surplus of SFr836.4 million.
Swiss foreign trade was in excellent shape in the first three months of 2006, a customs office statement said.
On the exports side, strong growth was broadly based, both from a sector and a geographical point of view, it added.
Analyst Astrid Frey at Bank Sarasin said the picture was looking “very positive”.
“Export dynamics are very strong… The fact that imports are rising is also good, because this normally goes together with rising domestic demand.”
Switzerland’s largest bank, UBS, reported on Tuesday that its consumption indicator had reached a new high of 1.74 for March, up sharply from February’s 1.40 and the highest level since April 2002.
The bank commented that this signalled “continuing solid growth in consumer spending”.
Watchmaking strong
In a related development, Swiss watchmaking exports rose 20.9 per cent year-on-year in March to SFr1.023 billion, the Federation of the Swiss Watch Industry reported, underlining a strong industry trend.
The federation noted in a statement that it was the first time that the value of exports had topped the SFr1-billion mark in a single month so early in the year.
The value of watch exports for the first quarter was SFr2.8 billion or 12.9 per cent higher than for the corresponding quarter last year.
In more related news, luxury group Richemont – which includes the Cartier, Vacheron Constantin and Piaget brands – announced sales for its fiscal year that beat even the most optimistic market forecast.
Strong demand
Turnover was up by 17 per cent to €4.31 billion (SFr6.78 billion), driven by strong demand for the group’s premium watches and jewellery.
“Richemont’s sales were clearly better than expectations, led by strong growth in premium watches as well as the Americas,” commented Jon Cox, an analyst at Kepler Equities.
The group is benefiting from strong demand for luxury goods as economies recover around the world, fuelling consumers’ appetite for accessories.
The boom in the watch industry was confirmed last month at the Baselworld world watch and jewellery trade fair in Basel.
Organisers reported a record number of visitors and a “remarkable end result” in terms of sales.
Exhibitors said they were “extremely satisfied” in commercial terms, although no precise figures were given.
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Swiss exports recorded double-digit growth in seven out of ten branches during the first quarter.
The strongest growth sector was precision instruments, followed by food, drink and tobacco; the chemical industry; the metal industry; the machine and electronics industry; plastics and watchmaking.
On the import side, capital goods, consumer goods, and raw materials all showed increases.
Exports in Swiss watch industry:
January – March 2006: SFr2.8 billion (up 12.9% compared with first quarter 2005).
March 2006: SFr1.023 billion (up 20.9% compared with March 2005).
Swiss watch exports in 2005 reached a record SFr12.3 billion (up 10.9% on 2005).
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